Each
Wednesday, The Wrap presents a compilation of recent noteworthy commercial real
estate stories from a variety of publications. Below are five stories that
caught our eyes in recent days.
• “A
Shale Game: Energy Industry Triggers Demand for Prime Real Estate” by Mark
Heschmeyer of CoStar.
The domestic energy industry — expected to create more than
3.5 million American jobs by 2035 — is driving much of the tenant demand in
office, retail, industrial and multifamily sectors, Heschmeyer reports.
Most of the energy-related demand will be in Dallas, Denver,
Houston, Philadelphia and Pittsburgh, according to Jones Lang LaSalle (JLL).
“In the top energy cities, commercial real estate markets
are booming, with growth creating scarcity, and thus a landlord-favorable market,”
Bruce Rutherford of JLL told CoStar. This growth already has real estate firms
investing in oil-rich areas, Heschmeyer reports.
The United States could become the number one shale oil
producer in the world by 2017, according to a new study by Leonardo Maugeri, a
researcher at Harvard Kennedy School.
• “Industrial
Tenants in for Cost Hikes” by John Salustri of GlobeSt.com.
Industrial tenants could see a 1.9 percent increase in occupancy
costs in the next five years, according to new research from DTZ.
The firm projects that Miami, Chicago and Houston will see
the biggest cost jumps, with each market experiencing a 2.2 percent gain.
Miami will see increases because of its proximity to the
Panama Canal, while Houston’s “robust energy sector” will drive its cost
growth, according to DTZ.
However, Boston will see cost breaks because of its abundant
supply, which gives tenants the upper hand in lease negotiations, according to
John Wickes, head of DTZ research for the Americas.
• “New
Hyatt Atlanta Midtown Hotel Opens” by Amy Wenk of the Atlanta Business
Chronicle.
After months of renovations, the Hyatt Atlanta Midtown hotel
has opened in the heart of the Midtown Mile, a walkable district of
restaurants, stores and offices in the city, Wenk reports.
Noble Investment Group LLC funded the acquisition and rehab
of the 194-room hotel, which was once known as Hotel Midtown before the firm
bought it out of foreclosure in 2011 for just $15 million, Wenk reports.
Noble Investment Group is behind the Atlanta-based W hotels,
Wenk noted.
• “Spanx
Gives Atlanta a Lift With New Headquarters” by Maura Webber Sadovi of The
Wall Street Journal.
Spanx’s recent announcement that it has signed an 11-year
lease at Buckhead Atlanta is giving the long-delayed mixed-use project a shot
in the arm, Sadovi reports.
The apparel company will occupy 86,000 square feet of office
space that includes a rooftop garden and loft-style floor space, Sadovi
reports.
The lease is an indication that companies are feeling more
confident in the current economy and that they are willing to take on new
office space as they hire more employees, Sadovi reports.
Some analysts are worried the demand for new properties will
hurt existing office space, but office vacancy rates in the Buckhead market of
Atlanta fell to 24 percent in the first quarter from nearly 30 percent in 2010,
according to Reis.
• VIDEO:
“Business Hotels Better Positioned in Current Market Environment, Analyst Says”
from REIT.com.
In
this clip, Allen Kenney of REIT.com interviews Lukas Hartwich, analyst with
Green Street Advisors, about the lodging sector.
Hartwich explains why business hoteliers are better
positioned in today’s market. He also discusses the pricing power lodging REITs
have and his short-term outlook for the market.